Are all veterans equal? – A guide to using your VA loan

Equal is such a definite word…similar to fair. I know when my girls were young, they would often complain comparing one’s treatment over the other whining, “That’s not fair.” To which I would remind them the (L.A.) County Fair wasn’t until September and they better be good if they wanted to go. Those little girls love the fair to this day.

“Equal” is similar to “fair” in that nothing is ever really equal is it? Sure, a cup of sugar is equal to two half cups, but we’re talking about life, rules, and people’s interpretations of those rules.

We’d like to think that all of our veterans are equal, especially when it comes to housing, with so many laws on the federal and state books regarding fair housing. Sure, all veterans have a VA Loan as one of their benefits of honorable service but the question is what does a veteran have to do to qualify for a VA Loan, besides put his life on the line for his country?

To receive the coveted Certificate of Eligibility, a veteran must meet the time criteria. During war time, 90 days of continuous active duty is sufficient; peace time you can double that to 181 days; if a veteran served his time in either the National Guard or Reserves, he or she must serve for a full six years before becoming eligible.

Should I stay or should I go?

Military people who are on active duty serve under a contract with a very specific date of termination, or discharge date. In military jargon, this is an “ETS” date. If a military member is planning on leaving the military on their ETS and it’s within a year, they probably won’t be able to use their VA Benefit until they can prove income after discharge.

Of course, reenlisting, or signing a new contract for several more years, will satisfy this need but they have to go ahead and do it before they can get their VA home loan.

The other issue active duty service members have to deal with is their specialty pay. Many will receive extra money every month for combat, hazardous duty, jump pay or other special earnings that may end and not be a reliable source of steady income.

Weekend warriors

The men and women who serve in either the National Guard or Reserves typically serve one weekend a month and two weeks a year, for a period of six years. Of course, many in the last couple of decades have been activated and served during war time. Depending on how their activation is classified, if they served 90 continuous days they may be eligible for their Certificate of Eligibility.

Retired or disabled

Those who spent 20 or more years in the military are eligible for retirement benefits. Those who have suffered a service connected permanent disability of 10 percent or more may be eligible for disability income. The disabled vets also will have their VA Funding Fee waived. The problem many veterans have is that it may seem to take forever before they receive their benefits. Additionally, disabled vets may be eligible of some additional benefits from their local municipality, their state or the federal government.

Military personnel are always on the go

In military units, there are always people coming and going. Service men and women who are nearing retirement may have difficulty proving adequate income to qualify for a home loan. The military will issue an awards letter documenting what the retirement pay will be, but this often does not come until shortly before the actual retirement. There are some lenders that will not even loan to a retired veteran until after they have received their first month’s retirement pay.

When a service member has a permanent change of duty station (PCS in military jargon) they must first have official orders before they can be considered for a new VA home loan – no matter how certain they are that they are headed to a specific destination, they are in the military and can end up just about anywhere without any advance notice.

Our veterans have certainly earned their benefits. The key is how to use them in the right way to get the most out of them. Call us today and get the information you need to make the right decision. The info is free, call now!